I have made it no secret on this blog how I want to be out of debt as soon as possible. I throw every extra dollar that I can at some level of the debt. So far I have made some pretty good progress. In earlier post I noted how I was back on track and ready to meet my goal of paying off 10% of my total debt by the end of the year. All of that is still true. In fact, if I just pay my normal payments I should not only meet that goal, but exceed by a couple hundred dollars.
One of the other things that I have not shared about my debt repayment plan is that I want my personal loan (just over $17000 a couple of weeks ago) paid off first. That is the first debt to go. I have had the loan for just over 15 months. It started off at $32000.
So my milestone is this as of the 15th of last week I had paid off over half of the loan $16000 in just over 15 months. Now that might not seem like a lot, but considering that my goal was to have this loan paid off within three years it is a pretty big deal. I have declared that I want to be consumer debt free by the time I am 45. I am not sure that I can accomplish that with my current debt payoff rate, but I will at least have this paid off within the next year. But there might be a hiccup?
Despite my current progress toward paying off this loan I am not sure I should be paying it off so fast. I mean I have almost four years to pay it off and the interest rate on the loan is 2.39%. So it is super low. My dilemma is should I continue paying this off as fast as possible or deploy my resources toward other debts? (e.g. mortgage, student loans). I mean I have been paying off my student loans for over 8 years and I am only just 1/3 of the way through paying those off. I hope to accelerate those debts more.
The good thing is that if I were to pay off this loan quicker I would have a lot of money to free up per month that could go to other things (e.g. student loans, investing, etc). I have low-interest rates on all of my debt. The highest interest rate is 4.5% and that is on my student loans. I can make more money in the stock market if I invest it. So while this is a great milestone I could’ve deployed those monies in a different direction and got more of a return on my investment. If you were me what would you do? Accelerate the debt payment on the one loan? Move some extra monies to other debt? Or invest it and begin a brokerage account?